TUSCALOOSA — Like the rest of Alabama, North Alabama has seen the cost increase for a person or family to comfortably afford to pay rent.
Three cities in the region in particular are experiencing this phenomenon: Decatur, Florence, and Huntsville, according to a recent report from researchers at the University of Alabama and two Florida universities.
Out of the three metro areas, Decatur saw the largest year over year increase in the cost of rent, growing by 14.33% from the previous year, the report said. The current average cost of rent per month in the city is $1,280.66. The minimal annual income required to not be rent burdened within Decatur is $51,202.
Florence’s year over year change in the cost of rent showed a 13.92% increase. The average cost of rent in Florence per month is $1,197.08. In order to not be rent burdened within the city an annual income of $47,883 is needed.
Huntsville, though the state’s largest city, saw the smallest change at 3.24%. The average cost of rent per month in the Rocket City is $1,518.18; the annual income required to not be rent burdenedis $60,727.
According to the report, the median household income for Alabamians is about $56,900, slightly less than the $58,800 needed, on average, for rent not to consume too much of a household’s expenses.
Consumers are considered rent-burdened when they spend 30% or more of their income on rent, lessening the ability to pay for other necessities.
“This is an amazingly high number. I think most will find this figure shocking, especially given that U.S. median income is $71,500,” said Dr. Bennie Waller, in the UA Culverhouse College of Business and a research associate in the Alabama Center for Real Estate at the university. “While the pace of rent growth is slowing around the country, housing affordability is coming more into focus.”
Waller believes Alabama and the rest of the country will eventually turn to an old solution to combat the rising prices in rent.
“In the past, the nation has dealt with unaffordable housing in the short run by moving in together,” he said. “This is what seems most likely once again.”
The study included Alabama’s 12 largest metro areas: Auburn, Birmingham, Daphne, Decatur, Dothan, Enterprise, Florence, Huntsville, Jasper, Mobile, Montgomery, and Tuscaloosa. The average rent across the dozen Alabama metro areas was about $1,400 in May.
Dothan is the highest in the state for minimum annual income to not be rent burdened at $68,467 and Mobile is the lowest at $47,813. The index is available here.
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